Saturday, February 8, 2014

Choosing Network Marketing

In my blog I have frequently spoken of my adventures as a teacher, but less often of my adventures as an entrepreneur.  In addition to teaching public school and a few private clarinet lessons each week, I own a network marketing business.

In network marketing, when we talk to each other and train, we speak a great deal about our "whys" and our stories.  While I frequently speak about my experiences with the products I market, I have rarely spoken about why I chose to go into business rather than just become a customer.  Perhaps that is because choosing network marketing was a more complicated decision, with several threads of thought and life experiences coming into play.  

Nearly three years ago I transferred from teaching middle school band for my district, to teaching elementary music.  In doing so, I took a pay cut (but also a huge cut in my responsibilities and time away from home).  At that same time, my husband was laid off from a job he'd held for 5 years, when they sold his division to another company...who decided that they would not offer him a position.  He had regularly made performance bonuses, all of his stats were consistently excellent, and he works in a normally very stable industry.  And yet unemployment still struck, for no better reason than the uncertainty of corporate politics.

Flashback three years before that.  I had just moved to San Antonio, and I had only one year of teaching band under my belt.  I only knew a small handful of people in my field in this area of the state, and none of them with the direct power to hire me for what I had trained to do (although those contacts were instrumental in helping me get my foot in the door and properly networked around here!).  The summer of 2007 found me unable to find full time work as a band director.  So I took the entrepreneurial route and began teaching private clarinet lessons.  It turned out that there was plenty of work available for a clarinet teacher willing to travel all over I did.  I ended up working and commuting full time...for what ended up being a part time paycheck.  That year gas prices hit over $4.00/gallon, and even in a fuel efficient car, I saw my profits eaten through my gas tank.  When you tell people that you make an average of $25/hour, they assume that you're rolling in money.  But that's $25/hour before accounting for gas money, car maintenance, car insurance, instrument maintenance and reeds...and doesn't include any benefits at all.  No paid time off, no retirement, no health or dental insurance.  Welcome to the world of traditional entrepreneurs from all types of businesses.  It's tough.  I diligently networked the entire year, meeting tons of local band directors by teaching their clarinet players.  I gained a very good reputation, and I soon had more offers for work in this field than I had available hours - and I was still broke.  The next year I did a variety of things to make ends meet, and in August of 2009, I took a position as a middle school band director.  A year and a half of intense work and stress later...I transferred to teaching elementary music, and my life changed forever...which brings me back to where I began my Network Marketing story, three years ago...

I met my future sponsor at one of my elementary campuses (I work at 2). She was a fellow teacher who I visited with during our lunch breaks.  After several conversations, reading through all the literature she provided me, and a lot of thought...I agreed to go see a full presentation of the business, where I would meet several other people involved in the business.

My future sponsor had provided me with plenty of samples of various products, and I knew the products to be of excellent quality...but that wasn't reason enough to join the company as an Associate.  There are tons of products in the world that I enjoy using, and I don't sell most of them, I just buy them.  So it begs the question...why Network Marketing?  Why THIS company?

1.  Compared to most businesses, network marketing (regardless of which company you might choose) has a low start up cost and low overhead.  Easy to start, easy to maintain. Even if you're spending a few hundred a month to maintain your business - it is still far less than what you would spend to purchase and maintain a brick and mortar store.

2.  Tax Advantages.  As a network marketing professional, your business is home-based.  Certain expenses become tax deductible...such as your phone, internet connection, purchases from your company, and even some of your entertainment (as long as you discuss business while you are out, and keep good records and receipts!).  That's just a small sampling of the deductions you can be eligible for by running a home based business.  It does complicate your taxes, but it is worth it.  I use an online program that walks me through the whole process each year with ease.  Also, the company I work with has excellent software available to Associates through our online portals, where we can track our deductible expenses as we go through the year, making tax season a breeze.

3.  Reliability.  My husband getting laid off three years ago, and my own difficulty getting my career back on track after moving across the state, highlighted for me the necessity of having a stream of income that did not rely so strongly on the whims of the corporate marketplace and demands for labor.  Owning a network marketing business is a smart move - even if you love your day job and have no intentions of leaving it.  When you own a business, you aren't worried about getting laid off or fired.  Of course, as with any business, you get out of it what you're willing to put into it!  Putting in the time and effort to be successful is crucial.  Perseverance is crucial too.  What about companies that are here today and gone tomorrow?  To that, I can only say that if you look to join this industry, then it is important to complete your due diligence before you sign any agreements.  Look for a company that has staying power.  Maybe you want to get in on the ground floor of a new company, and that's your thing...but really do your homework to see if their business plan has the power to take off and stay put.  Personally, I opted for a company that has a long enough history to show stability, and is listed on the NYSE.

4.  Compensation that is not computed based on time.  I know, I just mentioned that in order to be successful you have to put in the time and effort.  But as long as your compensation is based on the amount of hours you personally put into it, there will be a definitive ceiling on how much you can earn...and it often isn't very high.  This lesson I learned the hard way when I taught private lessons full time.  I did not run out of demand for my services - I ran out of time to add more clients.  And if I was sick, or a client was sick, or if anything went wrong that caused a weekly appointment to cancel...then I lost income.  I thought I was selling my expertise, but I was wrong.  I was selling my time, and I only had so much of it available to sell.  Network marketing pays based on product volume sold, not on how long it took you (and your team) to do it.  And since you work as part of a team, you get paid on not only your efforts and time, but those of your team as well.  This is time-leveraged income, and there are no ceilings!

5.  Flexibility.  Network marketing is a business that you can conduct anywhere that you happen to be, at any hour of the day, any day of the week.  It doesn't matter if all of your available hours to work on your business are on the weekends, or at night, or the middle of the day.  If you aren't going to be around people face to face, you can conduct business online too.

6.  Direct Sales and Network Marketing are the future of sales.  Companies that operate through direct sales associates often (admittedly not always!) offer a higher quality product line, the convenience of delivery to your doorstep, and exceptional customer service both by their corporate offices and your local Associate.  Start to finish, when you deal with a reputable direct sales company, it is a more personal, higher quality experience.  You know that the person who sold you these products honestly believes in their quality, and greatly desires for you to be fully satisfied with your purchase.  Associates want you to have the best possible experience with their company, and have every reason to be motivated to do make certain of it.  They are most often your friends and family, who want you to think well of them and their enterprise.  They also want their small business to thrive with repeat orders and loyal customers.  This arrangement really can be a "win" situation for every party involved. The corporation who makes the products makes a profit by selling their wares.  The associates get paid commissions for those sales.  The consumers get personalized customer service experiences with people they trust, along with exceptional products that meet their wants and needs.  

All of those are great reasons to join the industry.  So what goes into choosing a particular company to associate with?

1.  Choose a company who creates products that you believe in, products that you truly enjoy using.  If you love it, you will find it easy to strike up conversations about it!

2.  Really study the compensation plan.  If you don't think you can make it work, you won't.  A great compensation plan is a must-have!

3.  You will almost certainly have the opportunity to meet several established associates before you decide - ask yourself whether these are people you want to be around, to be associated with professionally.  This is important, because these are the same people who should be helping you get started...who you will be going to for help, training, advice, and support.

4.  Look for a company that has staying power and integrity.  If you choose a newer company, that means really analyzing the chances that their products are going to be able to gain market share - and hold onto it.  There's a good deal of research that goes into this part, and should not be neglected.  Choosing a more established company makes your research easier, and is less risky.  But every company, and every associate, has to start who knows, maybe you find the next big thing early on!  So do your homework and your analysis before you take the plunge.  Then commit to your choice!

In broad strokes, that really is about all there is to it.  Mostly, it is about choosing a company that really speaks to you.  Passion is THE driving force in this industry!

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